$219.2B Pulled Out of Mutual Funds in July

The assets held in mutual funds fell $219.2 billion in July -- before the announcement that Standard & Poor’s had cut its rating of U.S. debt for the first time ever.

The combined assets of the nation’s mutual funds decreased 1.8 percent, to $12.009 trillion in July, according to the Investment Company Institute’s official survey of the mutual fund industry.

Money market funds had an outflow of $118.89 billion in July, compared with an outflow of $41.05 billion in June, the ICI said.

Long-term stock, bond, and hybrid funds had a net outflow of $21.47 billion in July, compared to an outflow of $8.76 billion in June.

Bond funds had an inflow of $9.83 billion in July, compared with an inflow of $12.93 billion in June.

Flow estimates are derived from data collected covering more than 95 percent of industry assets and are adjusted to represent industry totals.

By comparison, $58.0 billion has flowed out of long-term stock, bond and hybrid funds in the weeks ending August 3, 10 and 17, combined. The biggest outflow, exceeding $40 billion, came in the week that S&P lowered its rating.

Stock funds posted an outflow of $31.60 billion in July, compared with an outflow of $22.94 billion in June.

Among stock funds, U.S. funds that invest primarily overseas produced an outflow of $3.02 billion in July, compared to an outflow of $2.25 billion in June. Funds that invest primarily in the U.S. had an outflow of $28.58 billion in July, after an outflow of $20.69 billion in June.